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Open Newswire

Budget amendment SA 621, to repeal the Foreign Account Tax Compliance Act (FATCA), failed to reach the the US Senate floor for a vote on Friday. FATCA was originally passed in 2010 to prevent corrupt activities and Americans from evading taxes abroad. The law requires foreign financial institutions to disclose financial information or face penalties.

"It's an unpopular idea to overturn existing tax transparency laws in the Senate," said Eric LeCompte, executive director of the financial reform organization Jubilee USA Network, which generated thousands of phone calls into the Senate in support of FATCA. "The lack of support for repealing FATCA shows how important anti-corruption legislation is to Congress."

Countries and financial institutions that sign FATCA compliance agreements with the US government agree to automatically share certain tax information. To date, over 77,000 banks and 80 countries have signed such agreements. In 2013, G8 leaders pledged to crack down on tax avoidance and improve transparency by working toward a global version of FATCA. The G20 that year agreed to automatically exchange information by the end of 2015 and called such exchange "the new standard." In 2014, 47 countries agreed to a global standard of information exchange developed by the Organization for Economic Cooperation and Development.

FATCA is part of a global campaign for financial transparency," noted LeCompte.

Jubilee USA Network is an alliance of more than 75 US organizations and 400 faith communities working with 50 Jubilee global partners. Jubilee's mission is to build an economy that serves, protects and promotes the participation of the most vulnerable. Jubilee USA has won critical global financial reforms and more than $130 billion in debt relief to benefit the world's poorest people. www.jubileeusa.org

A US House of Representatives Judiciary sub-committee is discussing legislation to give Puerto Rico's public utilities access to US bankruptcy protection. The Subcommittee on Regulatory Reform, Commercial and Antitrust Law is meeting to debate HR 870, a bill introduced by Puerto Rico's Representative in Congress. Puerto Rico has more than $70 billion in public debt, about $20,000 per resident. The island's government attempted to restructure its public utility company's debts but was stopped by a court ruling. As a territory, Puerto Rico cannot access International Monetary Fund (IMF) loans and isn't eligible for the bankruptcy laws that govern US cities and states.

"Puerto Rico is in a debt trap and this bill could be a way out," noted Eric LeCompte, executive director of the religious anti-poverty group, Jubilee USA Network. "In this case, bankruptcy laws can help, just as a global bankruptcy process could help all countries around the globe."

Some financial firms that hold Puerto Rican bonds oppose the bill. Those funds won a recent court decision to block the island's public utility company's $9 billion debt restructuring. Meanwhile, some hedge funds involved in Puerto Rico have been involved in allegedly predatory behavior elsewhere, including Aurelius Management, one of the lead plaintiffs in the Argentine debt dispute.

"It is troubling that there are predatory hedge funds involved in Puerto Rico," said LeCompte, a United Nations expert on debt and finance. "It's important to note that various predatory funds are on both sides of this battle. It shows that these funds will bend laws in either direction for their own interests."

The International Monetary Fund (IMF) is providing $330 million of financing to aid Ebola-impacted countries. The plan includes $170 million of debt relief and grant-like aid for Liberia, Sierra Leone and Guinea. The new plan also expands a debt relief facility previously used to cancel debt after Haiti's 2010 earthquake. The new expanded facility, the Catastrophe Containment Relief Trust (CCR), is now a permanent debt relief facility for the world's poorest countries when they experience shocks such as epidemics or natural disasters.

"This aid is so vital for the countries affected by Ebola," said Eric LeCompte, Executive Director of the religious anti-poverty organization Jubilee USA Network. "Now we have a permanent debt relief vehicle for when the poorest countries face certain crises. Essentially, a global social safety net is now in place to protect the least developed countries when they experience disasters."

$100 million of debt relief will come through the IMF's new Catastrophe Containment Relief Trust. Another $70 million in debt relief will come from other governments who hold debt in the three countries. Concessional loans of $160 million add up to a grand total of $330 million in new financing. The package also includes a new financing mechanism designed to deliver funds to disaster-impacted countries quickly without worsening debt burdens.

"This new fund is an important, permanent tool in the fight against poverty," noted LeCompte, who serves on United Nations expert groups on debt and global finance. "It means resources for countries that need them most at the time they need them most."

President Obama criticized Greek austerity programs in an interview that aired on CNN on Sunday. The United States President said: “You cannot keep on squeezing countries that are in the midst of depression.” Obama called on all sides to compromise and argued, "when you have an economy that is in a free fall there has to be a growth strategy and not simply the effort to squeeze more and more out of a population that is hurting." His comments follow French Finance Minister Michel Sapin's call for a "new contract" between Greece and Europe. The anti-austerity Syriza party won Greece's elections and is seeking to renegotiate Greek debt. Greece is the third-most indebted country in the world.

"Austerity simply doesn't work," said Eric LeCompte, Executive Director of the religious financial reform organization Jubilee USA. "I think President Obama and French leaders understand there needs to be an alternative."

Mr. Sapin met Sunday with Greece's Finance Minister Yanis Varoufakis and said Europe should review austerity policies within the Eurozone. The French minister said Europe should also discuss Greece's debt situation and he and President Obama both called on Greece to make internal reforms. Greece began a series of austerity measures in 2010 as part of its emergency loan from the European Central Bank, International Monetary Fund and European Union. Since 2010, Greek unemployment doubled and the country lost 400,000 jobs in 2012. The Greek economy contracted every fiscal quarter for five years.

The United Nations Economic Commission for Africa (UNECA) released a report calling for debt cancellation for Ebola-impacted countries. The new report, "A Case for External Debt Cancellation for Ebola-Affected Countries," calls on multilateral institutions and governments to cancel Liberia, Sierra Leone and Guinea's debts. The report argues debt relief would provide necessary "breathing space" to address the region's economic challenges. All three countries are ranked in the bottom 15 in the United Nations' Human Development Index.

"West Africa needs debt relief," said Eric LeCompte, Executive Director of the debt relief organization Jubilee USA. "Debt relief will not only fight Ebola, it will also provide a long-term investment in healthcare for the countries."

UNECA first called for debt relief in December. In November, the United States government called for $100 million in debt relief and took its plan to the G20. At the request of the G20, the International Monetary Fund (IMF) is currently considering a $300 million financing package that could include debt relief. In January, Guinea President Alpha Conde called for IMF debt relief. Guinea, where the outbreak began, spent more money on debt than on public health in the year before the epidemic began. All three countries have poverty rates above 50%.

The Syriza party won 149 seats in Greece's Parliament and formed a coalition government with the conservative Independent Greeks who won 13 seats. Syriza campaigned on promises to cease austerity measures and renegotiate some of Greece's debt.

"A third of all Greeks live below the poverty line and this was the reality they brought to the voting booths," said Eric LeCompte, Executive Director of the religious financial reform group, Jubilee USA Network.

Syriza opposes austerity measures that were part of the 2010 $147 billion loan deal during the Greek crisis. Since the deal, unemployment more than doubled and today, youth unemployment is at nearly 50%. The Greek economy contracted for five years in a row and Greece lost 400,000 jobs in 2012. Greece's debt burden is the largest in Europe and trails only Japan among developed nations. Syriza has proposed an international debt conference to renegotiate the length of payment terms and reduce the amount of Greek debt.

"The new Greek government is looking at innovative solutions to deal with debt and austerity policies that trap people in poverty," noted LeCompte who serves on debt expert working groups to the United Nations. "The question at hand is will the International Monetary Fund, European Central Bank and European Union be willing to negotiate."

Jubilee USA Network is an alliance of more than 75 US organizations and 400 faith communities working with 50 Jubilee global partners. Jubilee's mission is to build an economy that serves, protects and promotes the participation of the most vulnerable. Jubilee USA has won critical global financial reforms and more than $130 billion in debt relief to benefit the world's poorest people. www.jubileeusa.org

The anti-austerity Syriza party leads in polls heading into Greece's national elections Sunday. Syriza says if elected it will renegotiate some of Greece's debt and halt austerity policies. Syriza also calls for a European debt conference similar to the 1953 London Conference that relieved German debt and allowed the country to extend debt payments. The 1953 accord led to such incredible economic growth for post World War II Germany that the period is referred to as the "Wirtschaftswunder" or the "economic miracle."

"It's interesting that Syriza calls for a debt conference," said Eric LeCompte, Executive Director of the debt relief organization Jubilee USA. "It certainly worked for Germany in 1953 and can be a model for heavily indebted countries today."

Greece is the third most heavily indebted country in the world and the most heavily indebted country in Europe. It owes more than $360 billion in total debt. Current polls give Syriza a 4 to 6 percentage point lead over current Prime Minister Antonis Samaras' New Democracy Party.

"The Greek election is now a referendum on austerity and debt," noted LeCompte who sits on United Nations debt expert groups.

The International Monetary Fund (IMF), European Union and European Central Bank negotiated a $147 billion Greek bail out plan in 2010. The loan package included a number of austerity measures that sparked protests in Greece. From 2010 to 2015, unemployment rose from 12% to 26%, the economy contracted five years in a row and wages fell. The country's debt burden also grew. A group of economists released an open letter this week calling for the IMF and European Central Bank to cancel Greek debt and asserted that austerity is "crushing economic activity."

An Argentina bond contract clause expires on December 31 raising the possibility that hold-out hedge funds and Argentina could settle a long running debt dispute. After defaulting in 2001, Argentina restructured its debt with 92% of its bondholders and put in place the Rights Upon Future Offers or RUFO clause. The RUFO clause gives restructured bondholders the right to a higher settlement if Argentina settles at a higher level with another Argentine bondholder. When the clause expires midnight on Wednesday, Argentina and hold-out funds could reach a settlement that would not leave Argentina open to RUFO clause litigation.

"However this dispute is resolved, we're still concerned about the global implications of this case," said Eric LeCompte, Executive Director of the religious development group Jubilee USA. In the spring, Jubilee USA filed a US Supreme Court Amicus Brief to inform the high court of the case's impacts on developing economies. "Even if Argentina settles with the hold-outs, this extreme behavior is legitimized."

All Independent Media outlets have been asked to publish the following letter, from Assata Shakur. --editor--

My name is Assata Shakur, and I am a 20th century escaped slave. Because of government persecution, I was left with no other choice than to flee from the political repression, racism and violence that dominate the US government’s policy towards people of color. I am an ex-political prisoner, and I have been living in exile in Cuba since 1984.

I have been a political activist most of my life, and although the U.S. government has done everything in its power to criminalize me, I am not a criminal, nor have I ever been one. In the 1960s, I participated in various struggles: the black liberation movement, the student rights movement, and the movement to end the war in Vietnam. I joined the Black Panther Party. By 1969 the Black Panther Party had become the number one organization targeted by the FBI’s COINTELPRO program. Because the Black Panther Party demanded the total liberation of black people, J. Edgar Hoover called it “greatest threat to the internal security of the country” and vowed to destroy it and its leaders and activists.

In 1978, my case was one of many cases bought before the United Nations Organization in a petition filed by the National Conference of Black Lawyers, the National Alliance Against Racist and Political Repression, and the United Church of Christ Commission for Racial Justice, exposing the existence of political prisoners in the United States, their political persecution, and the cruel and inhuman treatment they receive in US prisons. According to the report: